Green lease law and regulation in Switzerland

  1. 1. Issues regarding the building itself
    1. a. Requirements under public building law regarding energy efficiency.
    2. b. Do the regulations applicable under a) only affect new buildings or do all the buildings have to be provided with energy efficiency facilities?
    3. c. Does the market pay any attention to energy certificates?
    4. d. How popular is certification of buildings (LEED, BREEAM, etc.)?
  2. 2. Issues regarding the use of the building
    1. a. Does there exist an obligation of the landlord to charge operating costs (mainly for electricity, water, heating) following consumption or does that need to be established by the lease contract? Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial, etc.)?
    2. b. Does a landlord have the right to perform construction measures to improve the energy efficiency of a building (also against the intention of the tenant). Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial etc.)?
    3. c. Does a landlord have the right to receive a reimbursement of the costs for the measures under b)? Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial, etc.)?
    4. d. If the respective rights mentioned in b) and c) do not exist by statute, but need to be established by the lease contract: Does a standard for such regulations exist (and what is its content)? Please give examples of typical regulations.
    5. e. Which other obligations regarding sustainability (building materials, energy efficiency, waste management etc.) exist? If they need to be imposed by the lease agreement: does a standard for such regulations exist (and what is its content)? Please give examples of typical regulations.
  3. 3. Allocation of costs; incentives to improve sustainability of buildings or its use.

1. Issues regarding the building itself

a. Requirements under public building law regarding energy efficiency.

The Swiss Federal Energy Act (“Energiegesetz”) states that the Cantons (i.e Federal States) are in charge of enacting specific legislation regarding, inter alia, the maximum allowed percentage of non-renewable energies for coverage of heating and warm water, provisions regarding new installations and replacement of stationary electric resistance heating, target agreements with major energy consumers, and consumption-based heating and hot water billing for new buildings and for “substantial renovations” of existing buildings.

According to article 11a of the Swiss Federal Energy Ordinance (“Energieverordnung”) “Substantial renovations” also include total renovations of the heating and hot water system, as well as, under certain circumstances, energetic renovations if they affect over 75 percent of the building’s shell.

The different cantonal energy statutes provide for different provisions regarding building requirements in terms of energy efficiency. However, often new buildings of a certain size are required to install metres for the measurement of individual usage of heating and hot water. Some Cantons also provide for a maximum allowed percentage of non-renewable energy for heating and hot water. A unification process of the cantonal energy statutes is also underway and should be completed by the end of 2011 (see www.greenbuilding.ch). This unification process will bring stricter rules in terms of energy efficiency. The long-term objective of the increasingly stricter regulations regarding energy efficiency is the zero-energy-house (“Nullenergiehaus”) – a house that can provide its own energy for heating and hot water and is thus not dependent on external energy – as a Swiss standard.

b. Do the regulations applicable under a) only affect new buildings or do all the buildings have to be provided with energy efficiency facilities?

As indicated above, old and new buildings are generally treated differently (and also differently within the different Cantons). While new buildings tend to have to adhere to more economic and ecological standards from the beginning, old buildings are mostly affected by the stricter requirements only when being renovated (e.g. energetic renovations or larger structural changes).

c. Does the market pay any attention to energy certificates?

Yes, corporate actors do consider energy certificates more and more. In a residential context, the urban regions tend to pay more attention to them than rural areas. The official cantonal energy certificate (“Gebäudeausweis der Kantone”-GEAK®) is only mandatory if the cantonal provisions provide for it to be mandatory.

In Switzerland, the most popular energy certificate is Minergie® (including its sub-categories Minergie, Minergie A, Minergie P, Minergie-Eco, Minergie-P-Eco, and Minergie-A-ECO) with approximately 22,000 certified buildings in Switzerland (see www.minergie.ch). LEED certified buildings are also present in Switzerland. However, only two buildings have been certified as yet; two are in the process of being certified. LEED certification mainly tends to be asked for by international tenants. BREEAM does not seem to be present on the Swiss market and the German Certificate DGNB, thus far, has only one certified building in Switzerland.

2. Issues regarding the use of the building

a. Does there exist an obligation of the landlord to charge operating costs (mainly for electricity, water, heating) following consumption or does that need to be established by the lease contract? Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial, etc.)?

Ancillary costs must only be paid if the lessee specifically agreed to this with the lessor (article 257a Swiss Code of Obligations, the “CO”) and they must be separately disclosed. No distinction is drawn between residential and commercial buildings in this regard. Swiss law does not dictate a special method of how these costs are to be distributed amongst the tenants. However, only the actual expenditures by the lessor for performances which are connected with the use the building are considered ancillary costs. Ancillary costs may also be charged in form of a flat rate.

b. Does a landlord have the right to perform construction measures to improve the energy efficiency of a building (also against the intention of the tenant). Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial etc.)?

No distinction is made between different types of buildings in this context. The landlord has the right to such construction measures. However, according to article 260 CO, the lessor may renovate or modify the object only if the work may reasonably be imposed upon the lessee and if notice of termination of the rental relationship has not been given.

c. Does a landlord have the right to receive a reimbursement of the costs for the measures under b)? Is there a distinction drawn between different types of buildings (e.g. residential, office, commercial, etc.)?

No distinction is made between different types of buildings in this context. The landlord may increase the charged rent after value-enhancing investments. Energetic improvements are considered value-enhancing investments according to article 14 of the Swiss Federal Ordinance regarding the rent and lease of residential and commercial space (“Verordnung über die Miete und Pacht von Wohn- und Geschäftsräumen”).

d. If the respective rights mentioned in b) and c) do not exist by statute, but need to be established by the lease contract: Does a standard for such regulations exist (and what is its content)? Please give examples of typical regulations.

Not applicable, statutory regulation exists in Switzerland (see above b) and c)).

e. Which other obligations regarding sustainability (building materials, energy efficiency, waste management etc.) exist? If they need to be imposed by the lease agreement: does a standard for such regulations exist (and what is its content)? Please give examples of typical regulations.

Some cantonal energy ordinances refer to being “state of the art” (“Stand der Technik”) when setting building measures. Often, “state of the art” is then specified to include certain standards of the Swiss Society of Engineers and Architects (SIA) such as SIA standard 380/1 regarding thermal energy in building construction (“Thermische Energie im Hochbau”). No specific standards exist for contractual obligations. However, corporate or private individuals may wish to set out specific obligations regarding energy efficient and sustainable buildings. The obligation to build according to the standards of such contractual obligations may be combined with the requirement to also adhere to building standards such as Minergie or LEED. More and more, especially in commercial lease contracts, the parties agree to adhere to certain standards, i.e. the landlord commits to build according to a specific standard and the tenant agrees to comply with such standards in connection with the tenant’s fit-out.

3. Allocation of costs; incentives to improve sustainability of buildings or its use.

There are possibilities to profit from cantonal incentive programmes in connection with building according to certain certified ecological building standards. Further, energetic improvements are tax deductible on federal and -depending on the Canton – fully or at least partially deductible on the cantonal level.